Asianomics says China’s rate cut is a “sign of panic”

That’s what Asianomics’ chief economist Jim Walker told Bloomberg. Walker was voted the best regional economist in an Asiamoney magazine brokers’ poll for 11 years through 2004. Here is what he told Bloomberg:

“The timing is a surprise but I suspect it demonstrates just how weak the Chinese economy really is. We believe that it is pretty close to recession.”

The central bank’s move may backfire if it “further dissuades people from putting money into savings and time deposits,” Walker said. “If anything, banks will need to raise their lending rates because their cost of funds is going up.”

In another piece of note, The Atlantic writes how today’s China is starting to look “scarily” like the U.S. in 2006. The last thing the world economy needs is for its biggest engine to break down too. Let’s hope this is just a hiccup.